The three months that have elapsed since the signing of the Israel-PLO Declaration of Principles have been filled with tragedy and genuine threats to peace. The euphoria that accompanied the signing in both Israeli and Palestinian society has subsided, not only among the often cited “enemies of peace” but now even the average “men on the street” are questioning whether peace is, in fact, near at hand. The spiral of violence is increasing and at times appears to be out of control, and is exacting a toll in human life and from the morale of Palestinians and Israelis. The result has been a shift back to “old thinking,” and every day those who oppose peace find reinforcements who share their fears and validate their hatreds. Statements made by both Israeli and Palestinian leaders show continuing and strong support for the peace process and the accommodation that such a process will require. But events on the ground are weakening the leaders’ ability to make the trade-offs needed to implement the accord. Had the past three months been uneventful, both leaderships would have had the time and political room required to negotiate and make difficult choices. But the rising death toll has reduced the breathing space provided by the September 13th accords to the point where both leaderships have become boxed-in by constituents who are by degrees angry, concerned and disheartened. In this context, more dangerous than the actual killers are the more mainstream leaders of Hamas and the Palestinian left opposition, and the Israeli Likud and religious right wing. Although they distance themselves from the acts of violence, the actively play off the fear these events bring out in both communities. This is textbook terrorism at work. Fringe groups use violence to create fear and provoke repression, and then reap the “harvest” of repression by claiming that the established order won’t work. What is novel about this situation is the unholy alliance between Israeli and Palestinian terrorists who are essentially working together to thwart the peace process. (It is would also be amusing to note, were it not so tragic, that the terrorists are convinced that the other can achieve what it wants through peace. The Palestinian extremists believe that peace will only bring continued Israeli domination; while the Israeli terrorists are certain that peace will eventually bring about a Palestinian state. It is lamentable that neither side is listening, because if they were the extremists from the other side might convince them to support the peace process.) Further complicating the situation is the reaction of the Israeli military, which has played into the hands of the “enemies of peace.” Excessive shootings and killings, the continued practice of hunting down and killing “suspects,” and the gratuitous brutality of daily life under occupation have contributed to a serious erosion of support for the peace process in the Palestinian community. So, too, the virtual silence of the Palestinian leadership (with one exception) in the face of repeated killings of Jewish settlers has brought many Israelis to wonder how secure their lives would be living next to Palestinian-ruled territory. While the words of both leaderships demonstrate a shared commitment to a negotiated settlement, the cycle of violence requires that they do more. To this point, they seem incapable of doing any more. The psychological breakthroughs of the September 13th signing was not accompanied by a political breakthrough. The accords themselves were left deliberately vague, ambiguous and, in a few cases, contradictory. It was hoped that the political capital earned from the signing would provide both the strength and incentive to resolve the difficulties – but, as I have noted, the passing of time, the violence and the reactions of both societies to it have eaten away at the capital earned on September 13. Consequently, both leaderships now find themselves in a position not unlike the one in which they found themselves at the conclusion of the ninth round of the Madrid talks. There is a desperate need for a breakthrough, but both sides are too weak to make any further movements. As before, such a situation may require an outside agent to help them do what hey are unable to do on a strictly bilateral basis. In this setting, the U.S. should play a more active role and become the “real partner” that Secretary of State Warren Christopher regularly uses when he describes this country’s role. Oslo happened because the U.S. could not or would not provide the independent leadership needed to help both parties move forward. After Oslo, the September 13th signing and the last three months of violence, a now and more volatile reality has emerged; but the stakes are higher now because so many people’s hopes have been raised on both sides of the Green Line. At this crucial moment U.S. leadership and action, which has been lacking during much of the post-Madrid period, is very much needed. The U.S. should not negotiate for the parties, but it should provide “good offices” and gap-bridging proposals to help the parties break deadlocks. It must also provide consistently strong reinforcement to both leaderships. And the U.S. ought to provide a balanced vision of peace attractive enough to assist both leaderships to win back the public support they need to make accommodations (and hence an agreement) possible. In the midst of negotiations it is difficult for a concerned public to tell the forest from the trees. Technical issues bog down not only the negotiators but also obscure from public view the desired outcome. It is, therefore, imperative that an outside friend of the process to continue to hold out the picture of where peace will lead. For Israelis to feel the sense of security to which will enable them to withdraw from the territories, they must be reminded that leaving the territories is not a favor or a concession but a necessity. Rabin recently articulated this idea in a major address, but it must be reinforced by repetition many times over. Israelis must realize that there is more security in peace than in continued occupation, and more prosperity and security within a comprehensive peace (including trade, travel, cultural exchanges, etc.) than in holding Lebanese, Syrian and Palestinian real estate. Similarly, Palestinians must be assured that the occupation will end and they will be free to shape their lives and determine their own destiny. The good offices of the U.S. should provide the Palestinians a portrait of their future as an independent people. Clearly, good offices and portrait painting can only do so much, and a third-party “full partner” can only do so much. There is a compelling need for concrete progress, however small it may seem, to help both sides prove that peace is not only possible but also that, when it is achieved, it will bring positive changes in people’s daily lives. The quicker the movement toward withdrawal and the establishment of a Palestinian police force, and the more rapid the improvement of daily life in the territories, the more rapid will be the decrease in violence. Palestinians will acquire a vested interest in stability, and will view terrorist acts as provocations that can only bring about a return of Israeli forces. Palestinians must be willing, as some Palestinian leaders already have, to assure Israelis that Palestinian police will provide security to all within their jurisdiction, and that they will crack down on violence. This is not anti-intifada. It is pro-intifada in the truest sense of building the infrastructure of Palestinian society toward Palestinian independence from Israeli rule. With assurances and a renewed sense of confidence and public support, Israel must move to stop the settlers because their violence not only kills Palestinians and impedes Israeli withdrawal (which is their intention), but it also blocks Israeli efforts to achieve recognition and end its regional isolation. Settler violence, then, helps perpetuate Israel as a garrison state at war with it neighbors. At the same time Palestinian violence, far from ending the occupation and bringing closer the day of a Palestinian state, slows the Israeli withdrawal and brings on increased Israeli repression. Extremists on both sides must be held accountable not for merely challenging their leadership and impeding this particular set of negotiations but, more significantly, for locking their respective societies into a maelstrom of conflict and fear. The cycle can be slowed and eventually stopped. The danger is that these three months of violence and repression have produced new scars on the psyches of both peoples that will make it more difficult to move forward. There still is no going back, but the new reality may not be as promising as once generally believed. The sooner the process gets moving again, the fewer obstacles there will be to overcome. All parties to the Madrid process, including the U.S., must work earnestly to fulfill their obligations to peace.

The tragedy and brutality of the occupation continues to torment the Palestinians of the West Bank and Gaza. The promise of September 13 has not yet borne fruit. Instead the cycle of violence has accelerated with dozens killed and hundreds shot and wounded. The prisons are still filled and the economy of the territories is strangling.

It is not the same old story. Enemies of the Israel/PLO Declaration of Principles exist on both sides and Palestinians have been victims not only of the Israeli occupation authorities, but also of their own internal opposition. Simultaneously, Israeli right wing opponents of the accords, especially the extremist settler movements, have declared a virtual rebellion against their government and have taken their rage out against the Palestinian population.

Through these dark clouds, however, a few rays of light shine with the spirit of the September 13 accords as leaders and members of both constituencies work together to sustain the momentum toward peace.

Here in the United States, Arab American and American Jewish leaders have struggled through these difficult days to remain focused on building a new relationship.

Interesting new realities have develop as a result of the accords. September 13 represented not so much a political or policy breakthrough (although on several levels it did) as it did a psychological breakthrough. It is true that many critical issues remain unresolved, but it is also true that Arab American and American Jews are meeting together and the leadership of both communities have become invested not only in building solutions but in providing some level of mutual support for their shared peace process.

Real differences remain. Neither side has given up its goals or principles, but the accords and the act of mutual recognition have created a new political reality which places both communities in uncharted waters: learning a new language, taking on new priorities, discovering a new center in the Middle East policy debate and working together to build a firm foundation for peace.

I am part of one such cooperative effort that was formally launched by Vice President Al Gore. It was on November 29-30 that the Vice President joined with a prestigious group of about 80 Arab American and Jewish American business leaders to help form “Builders for Peace: An American Private Sector Initiative to support Middle East Peace.”

The founding events included a Monday night meeting and dinner with Gore, followed by a series of Tuesday briefings given to the group by an impressive array of Clinton Administration officials.

“Builders for Peace” grew out of the request by President Clinton and Vice President Gore that Arab Americans, American Jews and other concerned citizens organize a private initiative to stimulate the economy of the West Bank and Gaza to bring the fruits of peace to the people of the region.

Witnessing the positive encouragement for cooperation created by the September 13th signing ceremony both the President and the Vice President decided to match the need for economic development in the West Bank and Gaza with the expressed desire of both Arab American and American Jews to play a constructive role in the process.

It was Vice President Gore who first contacted me and former California Congressman Mel Levine and asked us to head up this initiative. He pledged his support and that of the administration, but urged us to undertake it as a private initiative.

Recognizing that the private sector can move more quickly than the government, the goal of “Builders for Peace” is to focus upon the development of the Palestinian private sector as the fastest way to create good jobs and opportunities, and lay the groundwork for an upgraded infrastructure and a more dynamic economic environment.

As the founding document of the new initiative makes clear, as Palestinians become vested in developing their economy, Israel will also experience greater security and the benefits of regional stability and cooperation.

As conceived, “Builders for Peace” will organize business leaders, especially those in the Arab American and American Jewish communities to promote investment in the West Bank and Gaza. Recognizing that the Israeli regulatory regime has strangled the Palestinian economy, the organization will support policies and practices to facilitate secure and profitable investment in the private sector. The guiding rationale is that successful projects will demonstrate the benefits of the peace accord to both Palestinians and Israelis.

“Builders for Peace” asks Arab Americans and American Jews to lend their experience and expertise in joint projects that will promote understanding, cooperation and economic development. Not only will this promote prosperity and peace in the Middle East, this initiative will improve relations between these groups within the United States.

What was significant about the founding events of “Builders for Peace” was not only the personal support given the project by the Vice President but the extensive participation in the project shown by other leading members of the Administration.

Speakers at the events included Secretary of the Treasury Lloyd Bentsen, President of the Overseas Private Investment Corporation (OPIC), Ruth Harkin, Special Middle East Coordinator Dennis Ross and top officials for the U.S. Agency for International Development, the Department of Commerce, the U.S. Trade Development Agency and the U.S. Information Agency.

Vice President Al Gore reflected the tone of the two days at a reception where he greeted the supporters of “Builders for Peace.” “Our top people are focused on this effort to make sure your project will be successful,” he said. “I believe very strongly in the importance of this effort and in its necessity.”

“The roots of this initiative, it should always be remembered, was September 13. When that handshake took place and also the meeting of the two communities who had never before been pulled together in the same room for a common purpose, this electrified the atmosphere and made all of us feel that this opportunity could not be squandered or wasted. I knew from that meeting that we had the chance to do something very valuable in our world.”

Gore did not downplay the obstacles to implementing the accords signed September 13 nor the importance of maintaining a commitment to the process. “That difficulties have arisen on both sides is not surprising. That both sides have recommitted themselves to surmounting those difficulties and building on the progress of September 13 is what we should focus on. The glass is half full, not half empty, and we are moving in the right direction, not the wrong direction.”

Treasury Secretary Bentsen also articulated his support for the initiative as a vital part of making peace a reality in the region. “I think the success of this endeavor (the peace process) hinges on having an economic structure that will build and survive and create jobs to give stability in that area…. I think we’ve reached a critical point. We’re seeing the parties in the Middle East choose cooperation over confrontation. Given the history of that region, I think that ranks with the Berlin Wall coming down and the end of the Cold War.”

Bentsen added: “When there is economic security, there can be political stability.”

OPIC President Ruth Harkin outlined the plans of that agency to support private sector projects in the territories, including a commitment to provide $100 million in the form of loans, loan guarantees and political risk insurance to those American investors willing to develop projects in the territories. OPIC assistance to the West Bank and Gaza can be leveraged to generate a quarter of a billion dollars in total private investment. Specifically, OPIC plans to:

--· Provide OPIC loans and loan guarantees to help finance investment projects by U.S. firms in the West Bank and Gaza. This will include medium-and long-term project financing for U.S. investors.

--· Provide OPIC political risk insurance to U.S. firms investing in the West Bank and Gaza.

--· Conduct an investment mission to the West Bank and Gaza for U.S. firms interested in evaluating opportunities in industry sectors, including infrastructure development, food processing, business hotels, tourism and others.

--· Market new investment opportunities for U.S. companies operating in the region, in cooperation with private sector groups, including the Arab American business community.

Some Arab and Arab American friends have wondered why I have decided to participate in the project. Very simply, I think this kind of initiative is vital to constructing a better, more peaceful and more democratic atmosphere in the occupied territories.

I think this initiative is suited for the Palestinian people for several reasons.

First, the Palestinian economy in the territories already is overwhelmingly propelled by the private sector with close to 85% of the GDP generated by businesses now operating there.

Second, the Palestinians are among the most educated people in the Middle East and therefore even small-scale investment can generate great benefits if combined with a highly trained, highly motivated work force.

Third, the Palestinians, like many in the Arab world, have a strong history of entrepreneurial experience.

Fourth, the economy there is underdeveloped because of the harsh conditions endured by the people there. Palestinians I have spoken with about this project are greatly encouraged by such efforts and believe they can build a stronger, better society with a little creative help and capital.

Finally, I think the initiative could usher in a new era in Arab American and Jewish American relations. We will not agree on all issues, but perhaps the exclusion and demonization that has too often marked our relationship can be left in the past. That, at least, is my hope and I think the Arab American community will benefit in many ways if this occurs.

I think Ambassador Dennis Ross, special coordinator for Middle East policy, was eloquent as he shared his own perspective on “Builders for Peace.”

“What is more important than anything else is that a new reality is in fact created on the ground that everyone can see. It’s important for both sides. Palestinians have to see that not only does Israeli withdrawal begin, but that their life changes, that peace pays, that there is a fundamental difference because of this agreement, that they can begin to look to the future with a very different set of hopes and aspirations.

“Israelis, too, have to see that as they begin to withdraw, Israeli security is not endangered, that they don’t feel personally less secure because of this.

“As implementation proceeds, as real things happen on the ground, then you will begin to see the peace constituencies strengthened. That’s the challenge. If you begin to make a difference on the ground even in small-scale ways, the effect on the ground is going to be disproportionate to the input. What we are trying to do is change a psychology, what we are trying to do is create a sense of promise in place of despair.”